Norwegian close to deal on ICBC leases

Scandinavian airline’s examinership continues

Norwegian Air Shuttle (NAS) is close to an agreement on ending aircraft leases with Industrial and Commercial Bank of China (ICBC), the High Court heard on Thursday.

The troubled Scandinavian carrier and four Irish subsidiaries have High Court protection from creditors while examiner Kieran Wallace of accountants KPMG works on a rescue plan for the business.

Brian Kennedy, NAS's senior counsel, told the court that there had been "a significant degree of progress" between the carrier and ICBC on settling the airline's liabilities to the lessor.

ICBC leased 10 aircraft to the group, which were held by NAS’s Irish-based subsidiaries.

Irish lessor Aercap indicated that it would not be opposing Norwegian’s application to end leases over aircraft the Dublin-based company has supplied to the airline.

NAS is going through examinership, a court-supervised mechanism for rescuing insolvent or troubled companies, in the Republic, as subsidiaries registered here hold its aircraft.

Repudiate contracts

The airline is asking asked the court to repudiate contracts including aircraft leases. This involves ending these agreements with settlements covering both the period of the examinership and payments due before Mr Wallace’s appointment in November.

Creditors who have their agreements terminated in this way will receive the same dividend as that agreed by the examiner with all other claimants, on any outstanding debt due under those deals.

Mr Justice Michael Quinn is continuing to hear Norwegian's applications to end outstanding leases and agreements with various parties.